The daily morning Astorian. [volume] (Astoria, Oregon) 1883-1899, 1887-07-26
ORR BUILDING ASSOCIATION.


which is in a very prosperous condl-
ton. Organized but short time ago,
its funds are all taken up, there Is
demand for more money, and the first
series is already closed up. A second
series will be opened about the first OF
next month.
The Astoria Building and Loan As
sociation, and kindred associations OF
the same character, are potent factors
in the work of building homes IN city;
they are aids to the city's best inter
ests and are practical benefit to the
community. Their mode OF working
and manner of doing business Is q
crystalization of experience and Is q
good example of what intelligent CO.
operation and mutual effort can do.
81. The fundamental proposition is
the rent buys the home. Pay the rent
TO yourself for four or eight or ten
wears and own your home that has
meanwhile been your shelter.
Building societies-as they are some
what enormously called, for as rule
they do not build, only help their
members build for themselves-haye
been known in Europe for many years
There they are regulated by law, and
are under government inspection. The
aggregate capital of the incorporated
building societies of Great Britain Is
S263. .4O5,99O. If to this be added the
capital of the unincorporated building
societies, the amount will be S45O,OOO,-
000
The first organization Of this kind
in the United States was the Oxford
Provident of Frankfort, suburb OF
Philadelphia largely devoted to facto-
ries. This was organized in 1881. The
par value OF the shares was fixed at
$500. The initiation fee was 80 and
the monthly dues So on each share.
= The money thus collected was loaned
to the members on real estate security.
In just ten years the payments and
earnings brought the shares up to
$500, the limit fixed at the start, and
of course there was nothing to do but
to dissolve and divide up. This was
done and q disincorporation followed.
The success of this single organization
brought other similar ones into exist
ence, and by the year 1S45 their popu-
larity was such as to attract wide
spread attention. While Philadelphia
has always been regarded as the home
Of such organizations, Massachusetts
early took upthe idea, and multiplied
the humber rapidly. New York, New
Jersey and adjacent states followed In
the wake of Philadelphia and Massa'
cbusetts:, Subsequently the same kind
of organizations found existence and
favor on this coast, crossing the Rocky
mountains some time in the sixties.
Experience shows that about one
half of those who join these organiza-
tions become borrowers, while the re-
mainder are simply depositors. An
association of this kind depends upon
borrowers for the full amount OF Its
available funds for its existence. As
it can make loans only to members. it
is necessary that new members shall
join from time to time. To meet this
case was introduced the feature OF
serial issues of stock, instead Of plac-
ing the entire capital stock at the
start All societies of this kind organ
lied for the last ten years have been
on the serial plan. The shares are
generally placed at $500 each, payable
in 81 monthly installments. At fair
rate of premium, the stock will mature
in ten years. Or, in other words, by
the time the shareholder has paid il
$120 on account OF his share by
monthly installments OF 81 each, hi
stock will be worth 5000. The Wes'
Oakland of California matured its frs
series in -118 months, and paid eacl
share $202, or an average interest ol
the amount paid In of l4.40 per cent
per annum.
The mutual feature. is quite pro
nounced In these associations. Th'
shareholder, who is simply a depos
itor, gets higher rate Of interest thai
he could at any bank, while the Dor
rover reaps still greater advantages o
obtaining more favorable rates thai
he could at a bank, from the fact tina
ne participates in the earnings Of hi
own money, both in the form of inter
est and premiums The plan pursued
varies but little. For example, an as
.sociation organizes and puts out it
first series of 1000 shares. From tina
time forward it has $1,000 per montl
to loan out. Afterwards anothe
source of income is the interest on tn
loans made. The money on hand i
disposed of from time to time anon,